Crescendo Withdraws Dissident Geac Board Nominee

Date: Tuesday, August 23, 2005
Author: Chris Clair, Senior Financial Correspondent Hedgeworld.com

Crescendo Investments blinked Tuesday in its stare-down with Canadian software company Geac Computer Corporation Ltd. Eric Rosenfeld, who runs Crescendo and manages the Crescendo Partners II LP hedge fund that owns about 5% of Geac, issued a statement saying the man it had plugged for a dissident seat on the board—along with Mr. Rosenfeld—would not be running after all because of a previously unknown conflict. Gerry Smith, whom Mr. Rosenfeld identified in an earlier proxy filing with Canadian Securities regulators as "a venture partner with the Canadian mergers and acquisitions advisory firm Updata Capital Inc.," apparently discovered the conflict in the last few days. Instead, Mr. Rosenfeld will vie for a seat on the board with Dennis J. Conroy, a private investor and former "senior executive in the information technology industry," according to a statement from Mr. Rosenfeld. Shareholders who previously voted for Crescendo's slate can vote in favour of the new Crescendo Partners nominees by signing, dating and returning another proxy form. Geac officials took no time pouncing on the news. In a statement, they said Mr. Smith never was associated with Updata, citing John F. Burton, Updata's managing general partner, who told the Geac board that Mr. Smith "is not involved in an official capacity with the Updata firm and neither Updata Capital, Updata Partners nor any of its affiliates supports, or is part of any effort to interfere or become involved in the Board of Directors matters at Geac." "The misrepresentation that Crescendo and Eric Rosenfeld have made regarding Mr. Smith's affiliation with Updata is undeniable proof of the need for corporate governance and nominating committee processes for evaluating potential director nominees," said C. Kent Jespersen, non executive chairman of Geac, in a statement. "Furthermore, Crescendo's attempt to gloss it over by declaring that Mr. Smith had a conflict of which he was not previously aware provides further evidence of Mr. Rosenfeld's irresponsible approach."